NxStage Medical, a Lawrence, MA, company that makes dialysis systems, saw its share price plummet after announcing its first quarter financial results. The company traded as high as $15 earlier this year, but closed under $5 on Tuesday.
Though revenues grew nearly four-fold to $31.0 million (compared to $8.4 million in the first quarter of 2007), NxStage’s loss widened to $13.9 million from $12 million. The cost of sales grew to $27 million from $10 million; operating expenses rose 54% to $17.2 million, YOY.
Revenues were bolstered by the $78.7 million acquisition of Medisystems last June. In addition to manufacturing the cartridges used NxStage’s System One portable kidney dialysis machine (pictured), Medisystems makes hemodialysis blood tubing sets, A.V. fistula needles, and other hemodialysis disposables. Medisystems in-center business contributed $16.1 million in the first quarter of 2008.
At the end of the first quarter 2008, NxStage was working with 355 dialysis centers to provide home hemodialysis therapy to 2,481 end-stage renal disease patients.
This compares to 200 centers and 1,295 patients at the end of the first quarter of 2007. The company expects to end the year with between 3,100 and 3,500 patients using its System One device. Previously, it projected between 3,700 to 4,100 patients by year end.
Jeffrey H. Burbank, President and CEO of NxStage, commented,
“We are confident that home daily hemodialysis is a significant market opportunity in particular, over the long-term because of its clear patient benefits. We remain focused on delivering on our top line growth and economic improvement initiatives.”
The company estimates that more than one million home treatments have been performed with the System One. Revenues from the device nearly doubled to $10.5 million in Q1 2008, compared to $5.4 million in the first quarter of 2007.
Cash, cash equivalents and short term investments as of March 31, 2008 were $16.2 million. NxStage has an additional $20 million available under its revolving debt facility.
For the full year 2008, NxStage expects revenue in the $130 – $135 million range and a loss of $52 million to $56 million, or $1.41 to $1.52 per share.